What Happened?

Shares of residential solar energy company Sunrun (NASDAQ: RUN) jumped 6.4% in the afternoon session after it received positive attention from Wall Street analysts, including an upgrade and a notable price target increase. 

Analyst Michael Blum from Wells Fargo maintained an "Overweight" rating for Sunrun and increased the price target by 50% to $21.00 from $14.00. Additionally, Guggenheim upgraded the stock from "Neutral" to "Buy" with a new price target of $27.00, citing the company's effective business management in a challenging industry. These optimistic ratings followed a period of positive business developments for the residential solar installer. The company had posted its third consecutive quarter of revenue growth as it implemented its “storage-first strategy.” Sunrun also reported a more than 400% increase in customer enrollment in its home-to-grid virtual power plant programs compared to the previous year.

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What Is The Market Telling Us

Sunrun’s shares are extremely volatile and have had 81 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The previous big move we wrote about was 4 days ago when the stock dropped 20.7% on the news that the company reported third-quarter 2025 financial results that showed a significant miss on earnings per share (EPS), which overshadowed a strong beat on revenue. While total revenue grew by nearly 35% year over year to $724.6 million, its EPS of $0.06 fell well short of analyst forecasts of $0.14. This significant earnings miss suggested to investors that profitability remains a major concern despite the strong sales figures. Further fueling investor anxiety, the company's free cash flow worsened significantly, with a cash burn of $865.2 million in the quarter compared to $156.4 million in the same period last year, intensifying concerns about Sunrun's heavy debt load.

Sunrun is up 94% since the beginning of the year, and at $19.81 per share, it is trading close to its 52-week high of $21.29 from October 2025. Investors who bought $1,000 worth of Sunrun’s shares 5 years ago would now be looking at an investment worth $366.85.

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